Opinions of Value

Your source for appraisal news and trends

Tips for Year-end Tax Preparation

by

As 2014 draws to a close and appraisers prepare to put another business year behind them, it’s important they compile their tax documents.

According to the U.S. Small Business Administration, owners need to consider federal and state tax issues.


deduction-1Determine a strategy

Whether it’s knowing how spending impacts tax bills, in which year to incur expenses or understanding accrual and cash basis, appraisers and other small business owners have a lot to consider to help ensure the creation of a successful tax strategy. [Read more…]

Taking Valuation Abroad

by

The Appraisal Institute recently invited Ken P. Wilson, MAI, SRA, 2014 President of the Appraisal Institute; Leslie P. Sellers, MAI, SRA, 2014 Chair of AI’s International Relations Committee; and Frederick H. Grubbe, CAE, to discuss AI’s international efforts. They talked about AI’s growing global presence and outreach abroad.

AI: What is the Appraisal Institute’s global presence?USA flag pin in international collection

KW: Appraisal Institute professionals live and work in nearly 60 countries on six continents.

AI: Who are the Appraisal Institute professionals who live and work abroad?

LS: Appraisal Institute professionals outside the United States and its territories engage in a wide variety of practices, and many are highly credentialed.

KW: Nearly half of all AI professionals outside the U.S. and its territories hold the MAI designation.

FG: And organizations in at least four countries have expressed interest in AI providing its educational offerings, including China, Kuwait, Mexico and Saudi Arabia. [Read more…]

Appraisal Institute Adopts 2015 Budget

by

ai-blog-presidents-header-2014

Appraisal Institute Adopts 2015 Budget

The Appraisal Institute adopted its budget for next year among other actions taken during the Board of Directors’ November 20-21 meeting in Chicago.

The Board voted to amend existing policy to allow eligible Practicing Affiliates, upon application for admission to the Candidate for Designation program, to receive a credit for one previously-taken designation education course under certain conditions. Those individuals also would be granted a monetary credit applied toward Candidate fees in some situations. Additionally, the Board voted to maintain the 2015 chapter funding of Candidates for Designation and Practicing Affiliates at 2014 levels.

The Board also approved the 45-Day Notice shared with Appraisal Institute professionals October 6, which included proposed amendments to Regulation No. 2 regarding requirements for the SRA designation. The 45-Day Notice also included further amendments to the preamble to the AI Standards of Professional Appraisal Practice and the preamble to the AI Code of Professional Ethics, in addition to various amendments to other documents. The changes to the Code of Professional Ethics and Standards of Professional Appraisal Practice are effective January 1.

The Board also voted to send to 45-Day Notice proposed revisions of SRA designation requirements and proposed amendments to Regulations Nos. 1, 2 and 3 to make certain language in these Regulations consistent. Additionally, the Board voted to send to 45-Day Notice a proposal to eliminate the minimum length of candidacy required for general and review Candidates for Designation who do not already hold an Appraisal Institute designation. The Board also voted to send to 45-Day Notice a proposal to eliminate AI continuing education requirements for Candidates for Designation.

The Appraisal Institute’s Board of Directors is next scheduled to meet February 19-20 in Chicago. [Read more…]

Tips for Mobilizing an Appraisal Business

by

With 2015 just around the corner and mobile technology becoming more prevalent in the workplace every day, now would be a good time for appraisers to mobilize their businesses.

In fact, the U.S. Small Business Administration says advances in technology are made each day that provide additional opportunities and challenges for small business owners seeking to mobilize their companies.

change_ahead

Market for mobility

One of the primary areas where small business owners, such as appraisers, can benefit from mobilization is marketing. Whether it’s making a website mobile friendly, communicating with potential clients via text message or engaging in social media, having a mobile marketing presence is a key to success in today’s marketplace. In fact, a recent survey found that 80 percent of small business owners are leveraging mobile technology for work. [Read more…]

AI Seeks Proposals for 2015 Annual Meeting Educational Sessions

by

ai-blog-presidents-header-2014

AI Seeks Proposals for 2015 Annual Meeting Educational Sessions

The Appraisal Institute is seeking proposals by December 31 for panel sessions and presentations for its 2015 Annual Meeting. AI Connect is looking for highly skilled speakers who can address issues and topics of interest to the valuation profession. All panels/presentations will be assigned to one or more of the following tracks:

  • Commercial
  • Residential
  • General
  • Institutional Client
  • Attorney Client

Learn more about submitting a presentation. [Read more…]

Tips for Appraising Gifted Real Estate

by

According to the annual report from Giving USA Foundation and the Indiana University Lilly Family School, charitable giving in the U.S. rose to an all-time record in 2013 to more than $335 billion.

A recent article in Valuation magazine, Gifting for Good, addressed the opportunities that exist for appraisers in the growing area of donating real estate and also shared some strategies for securing assignments and avoiding potential pitfalls.

1. Beware of IRS regulationshousemade_of_cash

How is fair market value determined relative to gifted real estate? Where do comps fit in? What about unusual market conditions? IRS Publication 561 answers these, and other key questions for appraisers and is a must-read prior to accepting any related assignment. [Read more…]

How Appraisers Can Help Consumers Buy a Manufactured Home

by

Manufactured housing is one of the fastest-growing housing markets in the U.S., and, according to the Manufactured Housing Institute, more than one in 10 single-family housing starts was a manufactured home in 2013.

Interested homebuyers should enlist the help of a qualified real estate appraiser to consider the advantages of purchasing a manufactured home over a traditional build and determine if taking the prefab route is worth the investment in the long run.

Are manufactured homes cost-efficient?FEMA Orders Mobile Homes For Katrina Victims
Depending on the region of the country, construction cost-per-square-foot for a new manufactured home averages 25 to 30 percent less than costs for a comparable site-built home. (As appraisers know well, cost does not necessarily equal value.)

But what about appreciation? Just like a traditional build, there’s no guarantee that the value of a manufactured home will always appreciate — that’s dependent on outside economic factors and varies by region. However, independent appraisal studies confirm that simplybuying a manufactured home won’t hurt resale value or reduce resale prospects compared to a site-built home. [Read more…]

AI Tells Bank Regulators To Address Evaluation, Competency Issues

by

ai-blog-presidents-header-2014

AI Tells Bank Regulators To Address Evaluation, Competency Issues

The Appraisal Institute and the American Society of Farm Managers and Rural Appraisers urged federal bank regulatory agencies in a September 2 letter to re-evaluate policies related to appraisal exemptions established under Financial Institutions Reform, Recovery, and Enforcement Act regulations.

AI and ASFMRA urged the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation and the Board of Governors of the Federal Reserve to align their regulations with Dodd-Frank requirements, which allow financial institutions to use professional designations and other competency tests when hiring appraisers.

The organizations also asked the agencies to resist any calls for increasing loan appraisal thresholds ($250,000 for residential, $1 million for commercial), citing appraisals as a “gold standard” in real estate risk assessment. The organizations further asked that the agencies review their regulations in light of recent changes to appraisal standards, such as the Scope of Work rule that provides more client flexibility.

Read the joint AI, ASFMRA letter. [Read more…]

5 Tips to Stay in Business

by

Anyone who has started a business knows that it takes planning, money, motivation and passion. While getting a company off the ground is both exciting and challenging, it also takes a great deal of effort to keep the doors open.

A recent article in Valuation magazine, 9 Signs Your Business Has Stopped Growing, addressed what issues might indicate that a company is sliding. But just because there’s been a slowdown doesn’t necessarily mean the troubles are irreversible.

1. Be in it to win it

Appraisers can take several key steps to help ensure their business thrives including analyzing competition, staying focused and preparing to make sacrifices. Running a successful business takes more than just a good idea and solid professional skills.

Checklist

2. Follow the law

In addition to managing the day-to-day operations, appraisers and other business owners also need to be aware of importantlegal issues such as protecting personal assets and putting agreements in writing. Being aware of potential legal pitfalls, no matter how small they might seem, can help keep business owners out of trouble. [Read more…]

AI Board of Directors Adopts Standards of Valuation Practice

by

ai-blog-presidents-header-2014

AI Annual Meeting Highlighted by Speakers, Awards

The 2014 Appraisal Institute Annual Meeting drew nearly 500 attendees to Austin, Texas, August 4-6. The event featured four engaging general session speakers, more than 50 different education sessions and up to 90 hours of AI continuing education credit points and up to 14 hours of state continuing education credit, in addition to exhibits, awards and networking events.

The slate of speakers included former astronaut Eugene A. “Gene” Cernan, the last man on the moon; Mark G. Dotzour, Ph.D., chief economist and director of research at the Real Estate Center at Texas A&M University; Brian Olasov, managing director of McKenna Long & Aldridge LLP; and Texas Commissioner of Agriculture Todd Staples.

Eight appraisers were honored during an awards dinner August 6. Peter D. Bowes, MAI, of Denver and Reaves C. Lukens Jr., MAI, SRA, of Gladwyne, Pennsylvania, were honored with the Lifetime Achievement Award and Michael G. Miller, MAI, SRA, AI-GRS, of Richmond, Virginia, and Charles J. Lentz, MAI, of Orlando, Florida, were named the recipients of the Outstanding Service Award. President’s Award recipients were Craig M. Harrington, SRA, AI-RRS, of Chaska, Minnesota; Paula K. Konikoff, JD, MAI, AI-GRS, of New York; Richard L. Borges II, MAI, SRA, AI-RRS, of Seymour, Indiana; and Leslie P. Sellers, MAI, SRA, of Clinton, Tennessee. Read more about the award winners. [Read more…]